September 8, 2017
By Alex Keown, BioSpace.com Breaking News Staff
LARCHWOOD, Iowa – Elanco Animal Health, a division of Eli Lilly , is shuttering a facility in Iowa and terminating approximately 134 employees.
The Larchwood decision is part of a reorganization parent company Eli Lilly announced Thursday. The reorganization and job cuts are part of a reaction to changes in the diabetes market, one of the company’s biggest revenue drivers. The company said it was terminating up to 3,500 positions, as well as shuttering two research and development sites. Lilly said the cuts and reorganization are part of a plan to improve fixed costs. In addition to consolidating its Elanco sites, Lilly said it was closing R&D facilities in New Jersey and China.
The Larchwood, Iowa facility is used to develop vaccines for cattle and pigs, the Argus Leader of nearby Sioux Falls, S.D. reported this morning. A company spokesperson said the vaccine manufacturing will be moved to another Iowa facility where the company manufactures vaccines for companion animals, such as dogs and cats. Employees were told of the pending job cuts on Thursday. Elanco intends to cease operations at the facility by 2019, the Argus Leader said.
Betsy Villwock Bowman, a spokesperson for Elanco, said the changes to Elanco’s manufacturing will allow the company to remain competitive.
Elanco acquired the Larchwood facility in 2015 following a deal with Novartis . The Fort Dodge, Iowa facility where the companion animal vaccines are manufactured was acquired last year as part of an $885 million deal with Boehringer Ingelheim Vetmedica Inc. In addition to developing vaccines, the Fort Dodge site also has testing capabilities, including an on-site veterinary research center and lab space.
That deal allowed Elanco to acquire a portfolio of canine, feline and rabies vaccines, as well as a fully-integrated research and development site in Fort Dodge. That acquisition allowed Elanco to expand its pipeline to include vaccines for bordetella, Lyme disease, rabies and parvovirus. For the past three years the vaccine portfolio saw consistent revenue growth, Boehringer Ingelheim said in a statement. This year the company launched two new animal vaccines ULTRA Hybrid FVRCP and ULTRA Duramune Lyme, which were both included in the deal. Other vaccines included in the deal are the Fel-O-Vax and Fel-O-Guard lines for cats.
In June 2016, Elanco opened its 48,000 square foot state-of-the-art Vaccines Innovation Center in Indiana. The new facility is intended to be the centerpiece of the Elanco vaccines R&D model. In addition to developing vaccines for salmonella and bovine respiratory disease, the Indiana site is also working on alternatives to antibiotics in food animals and a master seeds suite for vaccine development. Additionally, the innovation center will “house research into several companion animal vaccines, including the exploration of more ‘patient friendly’ delivery technologies, which could make annual vaccinations easier for both the pets and the veterinarians who care for them,” Elanco said last year.
